Amidst increasing losses, Investors bid up Elastic (NYSE:ESTC) 19% this past week

Elastic N.V. (NYSE:ESTC) shareholders will doubtless be very grateful to see the share price up 32% in the last month. But that doesn't change the reality of under-performance over the last twelve months. The cold reality is that the stock has dropped 48% in one year, under-performing the market.

Although the past week has been more reassuring for shareholders, they're still in the red over the last year, so let's see if the underlying business has been responsible for the decline.

Check out our latest analysis for Elastic

Elastic isn't currently profitable, so most analysts would look to revenue growth to get an idea of how fast the underlying business is growing. Shareholders of unprofitable companies usually expect strong revenue growth. As you can imagine, fast revenue growth, when maintained, often leads to fast profit growth.

Elastic grew its revenue by 42% over the last year. We think that is pretty nice growth. Unfortunately that wasn't good enough to stop the share price dropping 48%. You might even wonder if the share price was previously over-hyped. However, that's in the past now, and it's the future that matters most.

The graphic below depicts how earnings and revenue have changed over time (unveil the exact values by clicking on the image).

Elastic is a well known stock, with plenty of analyst coverage, suggesting some visibility into future growth. So it makes a lot of sense to check out what analysts think Elastic will earn in the future (free analyst consensus estimates)

A Different Perspective

The last twelve months weren't great for Elastic shares, which performed worse than the market, costing holders 48%. Meanwhile, the broader market slid about 17%, likely weighing on the stock. Fortunately the longer term story is brighter, with total returns averaging about 1.3% per year over three years. Sometimes when a good quality long term winner has a weak period, it's turns out to be an opportunity, but you really need to be sure that the quality is there. While it is well worth considering the different impacts that market conditions can have on the share price, there are other factors that are even more important. Even so, be aware that Elastic is showing 4 warning signs in our investment analysis , you should know about...

We will like Elastic better if we see some big insider buys. While we wait, check out this free list of growing companies with considerable, recent, insider buying.

Please note, the market returns quoted in this article reflect the market weighted average returns of stocks that currently trade on US exchanges.

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This article by Simply Wall St is general in nature. We provide commentary based on historical data and analyst forecasts only using an unbiased methodology and our articles are not intended to be financial advice. It does not constitute a recommendation to buy or sell any stock, and does not take account of your objectives, or your financial situation. We aim to bring you long-term focused analysis driven by fundamental data. Note that our analysis may not factor in the latest price-sensitive company announcements or qualitative material. Simply Wall St has no position in any stocks mentioned.